GoldmanSachs666 Message Board

Fraud*According to the Collins English Dictionary 10th Edition fraud can be defined as: "deceit, trickery, sharp practice, or breach of confidence, perpetrated for profit or to gain some unfair or dishonest advantage".[1] In the broadest sense, a fraud is an intentional deception made for personal gain or to damage another individual; the related adjective is fraudulent. The specific legal definition varies by legal jurisdiction. Fraud is a crime, and also a civil law violation. Defrauding people or entities of money or valuables is a common purpose of fraud, but there have also been fraudulent "discoveries", e.g. in science, to gain prestige rather than immediate monetary gain*As defined in Wikipedia

Wednesday, December 14, 2011

Goldman Sachs is not especially known for creating new jobs. In an attempt to save money, Goldman plans to fire about 1,000 employees in the United States so they can hire the same number of workers in Singapore. Goldman did start a program in the US in 2009 which planned to invest $500 million to help small businesses grow and create jobs. The plan included an educational component on entrepreneurship taught by experts. Apparently, the results have not been stellar as reported by Dyan Machan in Smart Money.

Perhaps, Goldman Sachs would have helped small businesses and their communities better in the first place if they had not contributed to the financial meltdown which caused massive job losses in 2008.

Goldman Sachs announced in 2009 that it would invest $500 million and partner with Warren Buffett to help small businesses grow and create jobs. The response was enthusiastic: Certainly with that much star power, business genius and capital, the engines of enterprise would start cranking out jobs right and left.

Except that they haven't. More than two years into the five-year program, which planned to reach and nurture 10,000 small businesses, just 5 percent of that goal has been met, and Goldman is reassessing the amount of time it will need. And what of Buffett, who has maintained an active role (though not a financial one) in the plan? The often chatty co-sponsor declined to comment.

The program, called 10,000 Small Businesses, is based on the latest in job-creation research by Harvard Business School's Michael Porter, whose organization Initiative for a Competitive Inner City has claimed success in this field. Candidate businesses would be screened for growth potential and would receive up to 100 hours of education designed by experts on entrepreneurship at Babson College; separately, some would get capital from Goldman in the form of a loan. Layered onto that would be networking and mentoring help and the on-the-ground strength of local community-development finance institutions, which have experience lending to underserved populations that struggle to get loans.

Sounds like a winning formula. But there's scant evidence community-based lending creates many jobs, according to Paul Kedrosky, senior fellow at the entrepreneur think tank Kauffman Foundation, who calls most of these programs "train wrecks." Studies indicate that the businesses best at creating jobs are inherently more productive (think a revolutionizing tech company rather than a local landscaper) and usually have no trouble borrowing money. For other businesses, it doesn't matter how much coaching is given or money is lent there's a ceiling on their growth.

Approaching the halfway mark of the Goldman-Buffett effort, it looks like the skeptics may have a point. The program has rolled out in six cities: New York, Houston, New Orleans, Chicago, Los Angeles and Long Beach, Calif. But so far, only $20 million has been lent, and only 500 small-business owners have taken part in the program. As for job creation, Goldman declines to put out totals, but reports from the field look modest at best the New York branch of the program, for example, says its 82 graduates have created about 200 jobs.

Dina Habib Powell, who oversees the program for Goldman, says part of the problem is competition from other government and private job-creation efforts: "It's a crowded marketplace of solutions." Still, Powell says Goldman is pleased with its results so far and points to successes like Jessica Johnson, who plans to hire 15 more workers for her Bronx security firm Johnson Security Bureau. "We want to take the time to help businesses grow," explains Powell. Porter describes this phase as a gestation period, since the program is rigorously vetting applicants to focus only on those poised for rapid growth. "We aren't talking about mom-and-pop businesses," he says.

To see what kind of progress was taking place, I went to New Orleans to talk to some of the program recipients. While I saw promising businesses, few seemed to fit the ideal of using the program's resources to generate fast-lane job growth. For example, Betty Nguyen-Archote and Donovan Archote received a $50,000 Goldman Sachs loan to help renovate their Huey P's Pizzeria. But they say they were too busy to attend the business classes. As for scaling up, they'd like to add a sushi bar to the Asian restaurant they own, but not with the Goldman money. "We're a mom-and-pop," says Betty (something Porter might not want to hear). "Like a lot of Americans, we want to pay down our debt."

That's a common theme: Small businesses and their owners have been in debt-reduction mode, to the dismay of those trying to juice up our nation's anemic growth. What's more, it's not clear the Archotes needed Goldman's money: They were among a handful of entrepreneurs I spoke with who had already qualified for community-development loans before the program came around, so Goldman was not a game-changer.

6
COMMENTS:

JEHR
said...

Dear Mr. Blankfien

I am going to shamelessly appeal to your better nature now. Remember when, as a child, your mother talked to you about what kind of man you would be? Well, try to remember how idealistic you were. You probably wanted to do something that would make people happier or more comfortable. You wanted, perhaps, to contribute some new knowledge that would make people's lives better.

I'm sure you were sympathetic and empathetic to those around you and, as you grew older, these feelings extended beyond your own group.

Ask yourself: When did things go wrong? When did money and the pursuit of wealth become the most important thing to do? How many lives have been ruined by my pursuits? When will The Number be within my grasp--is a billion dollars enough? What kind of example am I to young people who may look up to me? Am I shallower now than when I was a young man?

These are hard questions but I think you can give the answers readily enough.

Prins says. "When you see 5,500 arrests across this country for the Occupy movement and you see zero on the part of CEOs and senior executives from Wall Street who took trillions of dollars out of our economy, out of the European economy, [and] are going around the world doing the same thing to Asia now, it is absolutely heinous."

Census data: Half of U.S. poor or low income(AP) WASHINGTON - Squeezed by rising living costs, a record number of Americans — nearly 1 in 2 — have fallen into poverty or are scraping by on earnings that classify them as low income. The latest census data depict a middle class that's shrinking as unemployment stays high and the government's safety net frays. The new numbers follow years of stagnating wages for the middle class that have hurt millions of workers and families. "Safety net programs such as food stamps and tax credits kept poverty from rising even higher in 2010, but for many low-income families with work-related and medical expenses, they are considered too `rich' to qualify," said Sheldon Danziger, a University of Michigan public policy professor who specializes in poverty.

Too Big to Stop: Why Big Banks Keep Getting Away With Breaking the LawFor the country's biggest financial institutions, it's still worth it to break the law, because the government has no way to make the banks pay for acting illegally

The issue in the Goldman case was whether the bank properly disclosed that John Paulson, a hedge fund manager, was involved in the selection of securities for the deal, because he wanted to bet against them. This time, Citigroup's own proprietary "trading desk" asked its CDO "structuring desk" to create a debt instrument that it could bet against. The trading desk came up with a list of securities to include in the new CDO and passed it on to the structuring desk, which in turn sent it to a supposedly independent third party that would manage the CDO itself, called CSAC.

In one email, the person on the structuring desk overseeing the deal wrote, "This is [the CDO trading desk]'s prop trade (don't tell CSAC). CSAC agreed to terms even though they don't get to pick the assets" (SEC complaint against Brian Stoker, paragraph 32.) Half of the eventual CDO was based on securities chosen by Citi's trading desk (paragraph 42). (Yves Smith has more, from the SEC's order against CSAC--which, by the way, is part of Credit Suisse, another big bank.) Of course, the structuring desk didn't do this just as a favor to the trading desk: "On November 14, 2006, Stoker's immediate supervisor informed Stoker that Stoker should take action to ensure that the structuring desk received 'credit for [the trading desk's] profits' on Class V III" (complaint, paragraph 33).

CAPTURED!

The absence of a factual basis is a decent legal argument, but I think what Rakoff is really taking aim at is the problem of regulatory capture. For Citi, the settlement boiled down to two things: a $95 million penalty and a promise not to break the law in the future. Anyone who can do basic arithmetic can see that it's worth it to break the law under those terms so long as you have a two-thirds chance of getting away with it (and who thinks the SEC is catching more than one-third of all violations?). And earlier in the case, Rakoff asked the SEC how often it has actually enforced the promise by a bank not to violate the law in the future. The answer: never, at least not in the past ten years (pp. 22-23).

In short, a settlement like this seems to have exactly zero value as a deterrent. http://www.theatlantic.com/business/archive/2011/12/too-big-to-stop-why-big-banks-keep-getting-away-with-breaking-the-law/249952/

Confidence in a systemically corrupt financial system cannot be restored without a complete public exposure of all the lies, fraud, misinformation and complicity.

The truth has a unique sting, and an equally unique ability to heal the destruction wrought by dishonesty, fraud and lies. The truth hurts, because the daylight of truth demands changes that the self-serving and those in denial desperately wish to avoid.

But there can be no healing or reconciliation without the truth, baldly stated and plainly spoken without artifice or spin.

If we can finally be truthful with ourselves as a nation, then we must admit that our financial system is fundamentally based on lies, fraud, embezzlement, misinformation, perverse filters and incentives, shadow systems that mock transparency and regulation, class privilege and the systemic flouting of the rule of law.

This is the truth that hurts because it reveals the financial system as one stupendous exploitative fraud; but it also reveals the complicity and irrelevance of our judicial system and the complete capture of the legislative and Executive processes of governance.

There is a system of government in which rule of law is merely a propaganda screen, where financial and political Elites run the show and escape the consequences of their actions: it's called tyranny. The truth is that we live in a financial tyranny.

GS666 #4 on TopSites List

Famous Quotes

The men the American people admire most extravagantly are the greatest liars; the men they detest most violently are those who try to tell them the truth. … H.L. Mencken

An age is called Dark not because the light fails to shine, but because people refuse to see it…James Albert Michener, novelist (1907-1997)

It is impossible to calculate the moral mischief, if I may so express it, that mental lying has produced in society. When a man has so far corrupted and prostituted the chastity of his mind as to subscribe his professional belief to things he does not believe he has prepared himself for the commission of every other crime. … Thomas Paine 1737-1809, Anglo-American Political Theorist, Writer

Laws just or unjust may govern mens actions. Tyrannies may restrain or regulate their words. The machinery of propaganda may pack their minds with falsehood and deny them truth for many generations of time. But the soul of man thus held in trance or frozen in a long night can be awakened by a spark coming from God knows where and in a moment the whole structure of lies and oppression is on trial for its life.: Sir Winston ChurchillWhen governments fear the people, there is liberty. When the people fear the government, there is tyranny. - Thomas Jefferson

When cheaters prosper, we end up with the worst possible system and to call it a free market system is an obscenity. -William BlackWhen the people fear their government, there is tyranny; when the government fears the people, there is liberty." - Thomas JeffersonI believe that banking institutions are more dangerous to our liberties than standing armies. If the American people ever allow private banks to control the issue of their currency, first by inflation, then by deflation, the banks and corporations that will grow up around the banks will deprive the people of all property - until their children wake-up homeless on the continent their fathers conquered. Thomas Jefferson - 1802

Don't be afraid to see what you see.

..................................... Ronald Reagan

When the people and the government fear Banksters like Goldman Sachs and JP Morgan, there is economic dictatorship that will destroy the very fabric of our existence as a civilized society.Mike Morgan

Let me control the money of a nation and I care not who makes its laws.Meyer Amsheil Rothschild

Together We Can Make A Difference!Larry Rubinoff*************Send your "Famous Quotes" to info@goldmansachs666.com